Question

When prices for goods with elastic demand change, demand adjust accordingly. When prices for goods with inelastic demand change, demand remains the same.

Match the changes in price for a good with the appropriate demand reaction.


1. Demand increases.
2. Demand stays the same.
3. Demand decreases.


A. The price of a gallon of gasoline rises by $0.25 after a hurricane.

B. After Halloween, grocery stores sell Halloween candy at 50% the original price.

C. A new law lowers the cost of prescription drugs.

D. In the spring time, animal shelters take in hundreds of kittens, as a result, they waive fees for cat adoption.

E. The price of beef rises after a new disease is discovered in cows.

F. Someone buys all the Swiss rolls in the cafeteria, causing the school to raise prices.

G. New cars become more expensive due to a microchip shortage.

H. A boutique has a sale for 25% off all purses.

Answer 1

A. The price of a gallon of gasoline rises by $0.25 after a hurricane. - 3. Demand decreases.

B. After Halloween, grocery stores sell Halloween candy at 50% the original price. - 1. Demand increases.

C. A new law lowers the cost of prescription drugs. - 2. Demand stays the same.

D. In the spring time, animal shelters take in hundreds of kittens, as a result, they waive fees for cat adoption. - 1. Demand increases.

E. The price of beef rises after a new disease is discovered in cows. - 3. Demand decreases.

F. Someone buys all the Swiss rolls in the cafeteria, causing the school to raise prices. - 3. Demand decreases.

G. New cars become more expensive due to a microchip shortage. - 3. Demand decreases.

H. A boutique has a sale for 25% off all purses. - 1. Demand increases.